Win rate
Win rate alone says nothing: a strategy winning 95% of trades loses money if the 5% of losses outweigh the wins, and a 30% win rate can be excellent when winners are three times the size of losers.
The pair (win rate, average win / average loss) is what determines expectancy — the average result per trade. Marketing that quotes win rate without loss size is either naive or deliberately incomplete.
Covered in depth in Lesson 13: Win rate is a vanity metric. Expectancy pays the bills..
Related terms
- Equity curve — The plot of account value over time — including open positions — that shows a strategy's character at a glance.
- Expectancy — The average amount a strategy makes or loses per trade, combining win rate and win/loss size into one number.
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